I have been a CPA for over 30 years focusing on taxation. I have extensive experience with partnerships, real estate and high net worth individuals.
My ideology can be summarized at least metaphorically by this quote:
"I have a total irreverence for anything connected with society except that which makes the roads safer, the beer stronger, the food cheaper and the old men and old women warmer in the winter and happier in the summer." - Brendan Behan
Nobody I work for has any responsibility for what goes into this blog and you should make no inference that they approve of it or even have read it.

Southern Baptist Minister Defends Clergy Tax Benefit

William Thornton has graciously agreed to do a guest post on the clergy housing allowance. Reverend Thornton blogs on issues related to his denomination under the title SBC Plodder.

When the housing allowance makes news, it is likely as a result of another lawsuit being filed against it or because of some prominent member of the clergy using the provision to shelter hundreds of thousands of their ministerial income on an opulent home or homes. Rarely newsworthy is the common, routine, and proper use of the allowance by tens of thousands of clergy for whom it is of such modest benefit that few non-clergy would object.

As a Southern Baptist pastor, I have benefited from the ministerial housing allowance and am fond of this particular expression of our tax policy. I have also been disgusted at the use of the housing allowance by a few highly paid clergy to shelter huge sums of income on fabulous primary homes and even second homes, though I understand that the latter has been suspended by a recent court decision.

I cannot make a sensible case for the average taxpayer paying taxes on his income without any exclusion for his modest home while wealthy clergy live in mansions valued in the millions and are able to exclude hundreds of thousands of dollars from income taxes under the housing allowance.

When Jesus said that in His Father’s house there were many mansions, I do not believe He had in mind a mansion of the type that wealthy clergy like ordained trumpeter Phil Driscoll and television evangelist Kenneth Copeland use to shelter income through the minister’s housing allowance. I also would speculate that Jesus would look askance at requiring others to underwrite part of the cost of such homes through tax policy.

But before we bury the allowance with a shrill trumpet blast from Rev. Driscoll or with haughty disgust over Elmer Gantry-type of religious racketeers, I would note that the average senior pastor in my own Southern Baptist Convention earns a salary of under $60,000. That pastor may live in a modest home provided by the congregation and almost certainly has no second home. Tens of thousands of these clergy appreciate the very modest tax benefit provided by the housing allowance.

I recognize that some object to the housing allowance on the basis of what they view as the illegitimacy of some members of the clergy whose ordination is viewed with suspicion. I grant that there are individual cases where it may be difficult to discern an ordained individual’s ministerial function and role but, again, only the most miniscule fraction of clergy would cause this question to be raised and I am wary of the government making determinations of legitimacy or illegitimacy of clergy. I have never known of a Southern Baptist minister who was ordained solely for the purpose of being eligible to shelter income through the housing allowance.

When our legislators or judiciary are asked to revisit the issue of the housing allowance, and there are some prickly issues involved in it, my hope is that they are not blinded by the tiniest fraction of recipients who raise the ire of us all so that they cannot see the vast bulk of people for whom it is beneficial.

—————————————————–

My own view of the housing allowance is very similar to Reverned Thornton’s and comes out of a similar environment from time spent as the most tax literate member of a congregation’s governing board. I will note that I believe that a minister who is required as a condition of employment to live in a house provided by his congregation should be covered by Section 119, the convenience of the employer section. Ironically, in the sixties and seventies some parishes gave up their parsonages because it was unfair to the clergy who were losing out on the automatic accretion in wealth that came from home ownership. Those were the days.

Post Your Comment

Post Your Reply

Forbes writers have the ability to call out member comments they find particularly interesting. Called-out comments are highlighted across the Forbes network. You'll be notified if your comment is called out.

Comments

As I noted elsewhere, what is commonly considered abusive about the allowance could be easily and quickly fixed by Congress and the President. They certainly didn’t waste any time in preserving the law and all its abuses when Rick Warren came-a-callin’ when his and every other “minister’s” housing allowance was called in to question.

The constitutional question is a little more troubling. If that issue is going to be resolved while maintaining the allowance instead of simply eliminating it, my opinion is that it would have to be allowed to a broad range of taxpayers; of which “ministers” would just be one group that would qualify.

As it was in the Warren case, there appears to be no political will to legislatively act on these matters.

Driscoll supporters are even pledging to make his cause and further appeal a cause for all ministers; as did Rick Warren.

So, while we wait, we should be supporting the effort by the Freedom From Religion Foundation to judicially test the constitutional mettle of IRC 107.

I find the name of the Freedom From Religion Foundation somewhat disturbing and most of the victories they tout as being rather on the silly side. I’m probably rather hide-bound in my thinking, but I really think the Founders were well disposed to religion in general just did not want the federal government favoring any particular sect. I suppose that is not consistent with post 1960 First Amendment jursiprudence, but so it goes.

FFR is finessing the standing issue by paying housing allowance to some of their staff making them aggieved plaintiffs. If they made me the judge I would say that they sound enough like a religion themselves that they should qualify so they have nothing to complain about. One more example of why I shouldn’t be a judge.

The religious community has had decades to clean up the mess that we know as IRC 107.

Alas, they would not.

There’s no room for complaining about the Freedom From Religion Foundation taking up the cause no one else would take up.

Think about it this way:

I noticed that James Robinson, the televangelist, and some Catholic fellow have been interviewed a number of times in recent days regarding some mutual interests they are pursuing.

Get it!

If James Robinson and a Catholic can cooperate in some mutual interest, then it should be no problem in supporting the FFRF IRC 107 Challenge where we share the same concern about the constitutionality of the law as well as its many abuses as it has been and is presently administered.

If I had the wherewithal, I would have filed the IRC 107 challenge myself.

For those that don’t like the FFRF rubbing the issue in the face of organized religion; get the President and Congress to fix the problem and moot the FFRF suit.